Maybe you've been hit with a Marshal/Sheriff's Notice of Garnishment. Maybe your employer has notified you that your wages will be reduced to satisfy an "income execution," otherwise known as a "garnishment."
Somewhere along the line, a "judgment" was entered against you permitting your creditor to take the drastic measure of forcing your employer to remit 10% of your gross income if you first fail to voluntarily do so.
You have options. But first, you need a basic understanding exactly how much your creditor can take.
Basic rule: 10% of your gross earnings will be deducted subject to a minimum wage analysis explained below. Gross income is defined as salary, wages, overtime earnings, commissions, income from trusts, before any deductions are made from such income.
Limitations of Garnishments based on Minimum Wage:
Under New York law, the garnishment will kick in only if your weekly disposable
earnings income reaches or exceeds $217.50.
Disposable earnings are defined as those weekly earnings left after deducting those amounts required by law to be withheld (for example, taxes, social security, and unemployment insurance, but not deductions for union dues, insurance plans, etc.).
Also, no garnishment can take more than 25% of your weekly disposable earnings.
So the basic rule: Wages subject to deduction are the lesser of
- 25% of disposal earnings; or
- 10% of gross earnings.
Additional Limitations for Pre-existing Court Orders for Child Support, Alimony, Maintenance, or Family Support:
If any such court order already consumes 25% or more of your disposal earnings, the income execution will not take effect. But the burden is on you to notify the marshal within that 20-day grace period to avoid having the garnishment served on your employer. If the execution is sent to your employer, it is
supposed to honor these garnishment laws.
If any such court order consumes less than 25% of your disposal earnings, then the income execution, added together with such pre-existing order, cannot exceed 25% of your disposal earnings.
If this breakdown is not clear, call us, and let's talk it through.
The income execution should also notify you of your legal right to request a court to deny, limit, condition, regulate, or extend the use of the execution. But you should also heavily consider attacking the judgment itself to vacate the entire execution all together. We do this repeatedly. You need to know all of your rights to place you in the best legal position. Do not assume that your adversary possesses an unassailable judgment. For example, New York law requires that you be properly notified of the underlying court action, and such a failure, could compel the court to overturn the judgment.
In our practice, the defense of lack of proper service of the initial lawsuit (usually due to service at an outdated address) is extremely effective at voiding the judgment. If the creditor sued you in the wrong county, even better, because now you have a potential countersuit under the FDCPA for a venue violation.
If the amount at issue is low, or you want to settle the debt, you always have the option of offering a settlement to avoid the income execution. This may be advantageous for the creditor because it will not have to wait a long time to get paid on the judgment. If your salary is low, and Marshal poundage fees are added to the equation, it could take years for the creditor to get fully paid. Furthermore, the income execution is only as good as the length of your employment.
The minute you receive any notice regarding a garnishment/income execution, call us for a free consultation to discuss your rights and your strategy.